Proprietary Estoppel Flashcards
(15 cards)
Proprietary estoppel
Proprietary estoppel is an equitable remedy in which, where a person has given an assurance over property, and this assurance is relied upon to the detriment of another individual, they may be estopped from reneging on that reassurance.
Thorner v Major outlined the three necessary elements for proprietary estoppel to exist
Namely, that an assurance was given, that reliance was placed by the other party on that assurance and that the latter suffered detriment as a result.
Taylor’s Fashions Ltd v Liverpool Victoria Trustees case
“Unconscionability” has increased in popularity as a test used to assist in the determination of proprietary estoppel cases since this case
The problem with a test based on unconscionability
The problem with a test based on unconscionability is that it is very much vague and subjective, in that what one judge considers unconscionable may be considered by another to be perfectly acceptable.
McMahon v Kerry county Council
The plaintiffs purchased a plot of land from the defendant county council with the view of building a school for the local area. Eventually this plan was abandoned, and the site was left undeveloped. The plaintiffs then discovered that the defendant county council was preparing to build on it, so they complained and the work stopped. Four years later the defendants built two houses on the land and rented these out. The plaintiffs discovered the houses on the lands a year later and sought to recover the land.
Finlay P examined the law and cited with approval the Ramsden v Dyson scenario:
Which deals with a situation where a landowner stands by while a stranger mistakenly improves the landowners property. He found that on the facts of this case, the case did not fall within the criteria for unilateral mistake as set out in Ramsden. He held that it would be unjust and unconscionable that the plaintiffs would recover possession and that they were only entitled to the market value of the land without the houses and to damages.
Carter v Ross
Unconscionability could not be invoked where there had been no assurance, and where the detriment was deemed insufficient to constitute a finding of proprietary estoppel.
Cobbe v Yeoman’s Row management ltd
The House of Lords clarified clarified that in order for there to be a basis for claiming unconscionability it is not enough to merely express a hope or expectation that the other person was going to act in a particular manner on foot of your actions. Rather the expectation must be created on foot of a clear and unequivocal representation. Lord Scott was of the view that one cannot base a claim of proprietary estoppel in unconscionability alone, but rather the three additional elements must also be present.
Finnegan v Hand
The plaintiff had worked on the farm of the deceased for 38 years and claimed that over the years the deceased had made numerous promises which led him to believe that the deceased would favour him in his will. The plaintiff was not named in the will and sued the estate on the basis of a proprietary estoppel having been raised or a remedial constructive trust arising in his favour. The courts found difficulty in finding the 3 ingredients for proprietary estoppel, and therefore preferred to use the remedy of the remedial constructive trust to find in favour of the plaintiff. It was said that the remedial constructive trust is imposed by equity to satisfy the demands of justice and good conscience and to prevent a person deriving profit from fraudulent conduct or taking unfair advantage of a fiduciary position.
Unconscionability in modern equity law
Although the relationship between the traditional probanda required to establish proprietary estoppel and the concept of unconscionability is not precisely clear, the concepts do have a close relationship in modern jurisprudence, and the traditional approach has not been replaced by the unconscionability concept, but rather enhanced by it.
Basham
Detriment will be suffered where the assurance on which the reliance was placed has been withdrawn. As stated in this case the detriment suffered will usually involve expenditure of money, however, she comments that “this is not the only form of detriment which will survive”.
Finnegan v Hand
The plaintiff had worked on the farm of the deceased for 38 years and claimed that over the years the deceased had made numerous promises which led him to believe that the deceased would favour him in his will. The plaintiff was not named in the will, and sued the estate on the basis of a proprietary estoppel having been raised or a remedial constructive trust arising in his favour
Remedial constructive trust in Finnegan
The courts found difficulty in finding the 3 ingredients for proprietary estoppel, and therefore preferred to use the remedy of the remedial constructive trust to find in favour of the plaintiff. It was said that the remedial constructive trust is imposed by equity to satisfy the demands of justice and good conscience and to prevent a person deriving profit from fraudulent conduct or taking unfair advantage of a fiduciary position.
Detriment in Finnegan
During those years he received less than adequate pay. As a result of the assurance of the farm, he refused to go into social housing also. Here an omission was considered detriment, as confirmed in Gillet v Holt.
Bracken v Byrne
The plaintiff claimed that an arrangement had been entered into between herself and her sister to the effect that she would be provided with a plot of land on her sisters land on which she could build a house. It was said that the only detriment she could have suffered was the making of planning applications and some brief discussions with a builder. This was found to be insufficient detriment to require a conveyance of the land in dispute in reliance on the doctrine of proprietary estoppel.
